Washington, D.C. America’s small businesses including more than 1.2 million Hispanic small business owners won a major legislative victory today when the House of Representatives voted to restore desperately needed funding for the Small Business Administration’s 7(a) flagship loan program. This program provides access to capital and is directly responsible for small business job creation.
Reps. Nydia Velázquez (D-NY) and Donald Manzullo (R-Ill.) sponsored a bipartisan amendment to the Commerce, Justice, State Appropriations bill that will provide $79 million in funding for the SBA’s 7(a) loan program. The 7(a) program is the most commonly used federal loan program for small firms and backs more than $13 billion in loans to small businesses each year. The amendment was approved by a vote of 281 to 137.
“We know that small businesses are the engine of our economy. They account for more than 95 percent of all private employers, create half of our gross domestic product, and create three out of four of new jobs nationwide,” House Democratic Leader Nancy Pelosi said. “Today’s vote is a victory for small businesses and a defeat for the Bush Administration, which had proposed a budget that eliminates funding for the 7(a) program, and proposes to charge small firms exorbitant fees to make up the difference.”
This year, Republicans proposed to totally eliminate the micro-loan program, which provides funding for small start-up businesses, as well as to eliminate all funding for small business 7(a) loans. Over the past three years, the Bush Administration created 76,000 pages of new regulation for small businesses. They also broke their promise to open the $235 billion federal marketplace and create a fair and open federal contracting system, costing small businesses $13.8 billion in lost opportunity each year.
Congresswoman Velázquez, the highest-ranking Democrat on the House Small Business Committee, pointed out that these actions have made it harder for small businesses to expand and create new jobs.
“The 7(a) program is this country’s largest source of long-term small business lending for both the private and public sector - providing 30 percent of this nation’s long term loans,” Velázquez said. “Given its tremendous success over the years, it is unbelievable to me that this critical loan program has been under nothing but attack from the Bush administration. This is the same Administration that claims to be the champion of small business. If we want our nation’s small businesses to continue creating the jobs we so desperately need then it is in everyone’s best interest to provide them with the access to capital that they need.”
In addition to fighting for funding for the 7 (a) loan program, Democrats in Congress have also proposed a new tax credit to help small firms purchase affordable health insurance, full funding for the SBA and its other loan programs for minority-owned firms, tax incentives to help manufacturing firms, and measures to reduce paperwork and help smaller firms get government contracts.